Anonymous Communication Networks and Their Potential Role in Business

The notions of on-line black markets, services and information that occur and can be found on the ‘Deep Web’ (or however else it may go by–the collection of web addresses not indexed by search engines) are presently relatively well known. For those unfamiliar with the topic, a study in 2001 estimated the size of these non-indexed internet sites to be around 7.5 petabytes (Bergman, 2001). Currently, estimating the size of these non-indexed sites has proven to be even more complicated since content stored in its databases have peculiar features complicating their access. As an example, for data mining, this information can only be accessed through the query interface they support based on input attributes obliging user queries to specify values for these attributes (Liu, Wang & Agrawal, 2011). These intricacies have made it near-impossible to accurately determine, and even harsh to estimate, the size of this vast collection of information.

The ‘Deep Web’ has grown in importance as of late (Braga, Ceri, Daniel & Martinenghi, 2008; Cali, Martinenghi, 2008) and with it, the use of anonymity networks such as Tor. For the readers unfamiliar with Tor, “The Tor network is a group of volunteer-operated servers that allows people to improve their privacy and security on the Internet. Tor’s users employ this network by connecting through a series of virtual tunnels rather than making a direct connection, thus allowing both organizations and individuals to share information over public networks without compromising their privacy.”. In short, Tor works by giving you a randomized relay IP-address donated by volunteers continuously such that no single relay point knows the route a user has taken throughout the random-generated relay route up to the user reaches their desired website. This process is repeated and is different every time the user visits a site. It goes without saying that the more users take part of this tool the “more randomized” it becomes. It does come with one weakness however, and that is node eavesdropping, or end-to-end correlation analysis. In short, both node ends between communication ports can be inspected to find a match in information and thus identify users. (For more information click here).

This is all fantastic news for reporters seeking to share controversial stories in oppressive governmental situations, or in general oppressed people seeking to express controversial messages. However this has also fostered crime through virtual networks, inducing organizations such as Interpol to obtain training in how to use and, “gain the upper-hand” with, these tools (Dutch/English). The amount of discussion about the level of anonymity in this network is vast and can be commonly found throughout both indexed and non-indexed web addresses. It commonly discusses the aforementioned end-to-end correlation analysis, points of encryption, whether to use TAILS, and where to use it from, and how often, self-destruct emails, personalized email encryptions, black bitcoin wallets, and much, much more.

This brings this blog to its fundamental point of contemplation which is much more relevant to this blog’s strategic perspective. How can this play out for business? Can IT-savvy security traders in worldwide financial capitals make use of these tools for own gain? Could this lead to a new financial meltdown where individual players’ lust for capital gains leads to the breakdown of a financial system? How could anonymous messages among acquainted parties play out in the M&A market, where secrecy is a fundamental pillar of daily business? How could this play out for entire industries?

There is no doubt that anonymous communication leads to freedom. This freedom is presently available to whoever has the knowledge to harness it. In a world where knowledge is openly available to any with a computer and internet connection. Both to the oppressed as well as to powerful individuals who are trusted with responsibility, and are closely monitored by third-parties because of mistakes occurred in the past that have led to a negative impact for several individuals.

In my own conceit, these tools can prove to be radical for business. A truly anonymous communication network would return the fullest definition of trust back into business. However, knowing human nature as it has shown itself throughout history, these tools might prove harmful in the long-run, assuming they are kept being worked on and made more common among society.

Let me start by quoting “A truly anonymous communication network would return the fullest definition of trust back into business.”

What do you mean by this, and exactly what could be “radical for business”? Are you implying all knowledge of businesses should be shared? Because a world where everyone shares their knowledge is interesting. But knowledge one company has and another company does not is considered a competitive advantage, and not all knowledge can be protected by patents, so certain company secrets must be kept secret.

However, I do like the article, it is well written and has an interesting view on the anonymous communication networks! Nice job.

The intention was to highlight the implications of a “perfectly” anonymous communication path among business parties. When saying that this could be “radical for business”, I was thinking about the possibilities for Insider Trading. Imagine what a well-used communication path like this could do in the hands of smart hands in Wall Street. The thought of corrupt Wall Street “Cartels” crossed my mind.

Not only has this crossed my mind but also plans for Embezzlement, Fraud, in fact, any corrupt corporate practice you might think of could be carefully coordinated from a distance through the use of these tools.

Glad to hear you liked it, and I hope my thoughts helped show the perspective I attempted to give to the subject!

I’m not completely sure that I understand correctly how the Tor system works, but sharing information anonimously on a public network will not cause insider trading right? And on a public platform people will not discuss their embezzlement plain either? I do understand how it can cause controversial outings of opinions on politics and such, but for these types of criminal actions it is tit for tat, so you want know who you give information to receive something in return.
I can see how the self destructing emails play a part in this but will it become common use for people that work in e.g. M&A to use self destructing emails when they want to make a deal? Or is it just naive thinking on my part that 99% business man are no criminals?

Thanks for your post! It is not that Anonymous Communication Networks (ACN) create insider trading, it is that this industry has had a general historical tendency towards cheating. I am sure you can find plenty examples of it. ACN can provide them with a (relatively easy to use) tool for them to yet again continue these actions. Truly, embezzlement will not be discussed on a public platform, hence the use of an anonymous service such as the one provided by Tor. They could set a non-indexed site in which files could be stored and shared among perpetrators/conspirators.

When I thought of M&A I thought of CEOs wanting to sell their company discretely. That is why they hire externals to do it for them. But anonymously, CEOs might be able to do this alone without having to pay the high fees and sacrificing part of the sale money! There is definitely sketchy business out there. Whether it is 99% I would not know, but this tool certainly can provide a nice way in which to conduct sketchy business!

I don’t know if I’ve interpretted the Tor system correctly but when it comes to insider trading I don’t think people will post their business knowledge on a public platform just to out their insights. I do see how it relates to politic outings but for the financial market it will only cause noise trading (which could still have big effects on businesses, don’t get me wrong). For the use of self destructing emails and those types of methods, that I personally see as more criminal and harmfull; I know that there is a lot of corruption, but is it really naive to think that most businessman are not that criminal and the maginitude of the effect caused by these new resources will stay limited? especially when you know that organizations like interpoll have uncovering these methods as their full time job?
I do think that your story is very interesting. I have a great interest in finance and have had a previous course where they mentioned how far insider trading can go but advanced ways to trade information never came up, so I like the new insights on this matter.

About Tor,and insider trading, you can look at my reply above. If you don’t understand Tor so well yet you can also follow the link I posted above in the original post which will lead you to the website that contains vast information on the subject.

Interpol has indeed full-time people employed investigating corrupt, illegal and fraudulent actions undertaken throughout the internet. The concept of online hacking is nothing new. Banks have been losing the most (http://www.securityweek.com/hackers-hit-100-banks-unprecedented-1-billion-cyber-attack-kaspersky-lab). The simplest methods like placing devices under tables in a bank to intercept information that could be used later to realize unintended transactions, etc. These criminals are hard to unveil. There are few cases, at least few I have read about, where these e-criminals are caught. Mostly because it takes too much effort to follow the crumbs, which would probably lead to another crime occurring in the meantime.

Good to hear that you like it! Always nice to have some discussion on the subject.

As you also mentioned in the post: anonymity can be both fantastic but can also encourage crime and I completely agree with that, let’s look at an even simpler example that the ones mentioned by you: users commenting and expressing their opinions online anonymously.
Businesses can definitely benefit by getting to know users opinion about their products and services, their complaints and satisfaction as people feel much more comfortable sharing opinions when no one knows who they are. But it also encourages people to stick less to the “social norms” of respecting each other or simply taking responsibility for their actions which for me is a bit scary. To mention a current example: right now Hungary is facing incredible challenges with managing the amount of refugees transiting through the country and although thousands of volunteers are helping day and night to make the situation less desperate, other thousands post terrible comments -without any knowledge on Islam, situations in Syria or ever seeing a refugee in person- under articles about volunteers/refugees etc. Many Hungarian new sites (Index, wmn.hu etc.) reported that they have never experienced so many negative comments under any of their articles as in the current situation. And a couple of days ago an announcement came out looking for people who were “against refugees” to take part in an open, real-world (so not online) debate about the topic: the response rate was super low.
All in all I think we need to be cautious about is what impact it has on people (not even talking about digitally native kids because that could be one entire post:) that their opinion is just one in a million that they can “shout out” without needing to stand by it with their face; without needing to face any consequences (both good and bad); and without learning how to take up conflicts in a constructive way.

This can truly be terrible when taken to the wrong side. “Trolls” can become extreme at times, and go even further than a few ignorant remarks to extremist comments.

Anonymity can lead to a high degree of honesty however, which can be useful for people to obtain an (even more) accurate picture of the opinion of people within political subjects such as the one you mentioned. I would like to believe that having everybody in an “equal playing field” like one that could be created in aforementioned network could also create room for “real” dialogue where ideas can be carefully considered and weighted. In such environments where identity is not attached to a face or reputation, I believe an idea would have much of a bigger weight on basis of its underlying arguments. Blogs could be made popular for highly controversial subjects, where people would share their opinions anonymously earnestly.

A very interesting read indeed; you raise a very interesting point Denis.@romylynndevries; As you said most business men are not corrupt; however I am afraid that the ones that are corrupt are getting the precise tools they need to take this corruption to the next level.
Let us assume that we can create an untraceable and perfectly encrypted communication (using the tools described above by Dennis and the ones I will describe hereafter). The implications for corrupt and/or colluding people would be massive.
Some examples of Encrypted e-mail services that I think are worth mentioning separately:
“PGP”; “Lavabit” and “DarkMail”;
E-mail encryption services are by no means new (in 1991 Phil Zimmerman created PGP). I believe even when facing heavy resistance, these kinds of services will continue to exist (as long certain people perceive the need for them; knowing other communications methods are not truly secure).
LavaBit: (created by Ladar Levison) was made “famous” because Edward Snowden used it when he was still hiding; before disclosing his identity. It is said that this encryption could not even be decrypted by intelligence agencies. Ladar however discontinued this service due to the US government ordering him to provide the private SSL keys (hereafter Ladar could no longer guarantee the service to be “secure” and discontinued it).
DarkMail: the next initiative striving for e-mail privacy has been created (co-created by among others: Ladar Levison and Phil Zimmerman).
The use of “Tails” and/or “TOR” in combination with these types of e-mail services (PGP; Lavabit; Darkmail) presents probably the most effective way to communicate covertly between parties (regardless of physical location).

Thanks for your comment! I had these mail systems in mind among others which you can find if you know how to browse the Web + “Deep Web” enough. Cool to know that you found this post interesting too. I was actually surprised by the number of people in our class that were unaware of this!

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